4.2.2. A second pulp kettle

All of the calculations presented above are based on the assumption that APRIL's pulp plant in Riau has only one production line, which, incidentally, was the world's largest when it was opened. APRIL, however, is planning on expanding the production capacity of its existing production line as well as constructing a second production line with the same capacity. The current concession areas will not be sufficient to fulfil the needs of the second pulp kettle. Another 100 000 ha would be needed according to APRIL's production calculations. [For a pulp capacity of 750 000 tn/a, 100 000 ha of plantations are needed. After the expansion of the first line's capacity, 133 000 ha will be needed and after the second million ton kettle has been put to work, 267 000 ha will be needed. The estimated net area of APRIL's current concessions that can be used for plantations, however, is only around 172 000 ha (SGS, 1998).]

The need for more wood might be exacerbated by a worse than expected yield from acacia plantations that have been founded on swampy areas. This also poses a financial risk to the company. As one forest industry analyst puts it:

"Probably the greatest medium term threat facing the two major pulp projects in central Sumatra (Riau Pulp and Indah Kiat) is the future success, or failure, of Acacia mangium grown in peat swamp country after native logging. … If these major plantations fail, both APP and APRIL will indeed be in the market for huge volumes of imported wood (from other Indonesian provinces, or from overseas) to keep running, past 2005-2010." (Neilson & Fenton 1998)

The SGS certifiers come to much the same conclusion when assessing the sustainability of APRIL's plantations:

"Current establishment practices distinguish between dry (Acacia mangium) and wet (Acacia crassicarpa) sites. Neither species has been proven conclusively satisfactory for the peatland sites and plantations on this site type in other ownerships show pockets of poor health and mortality." (SGS 1998, p. 38)

In addition to the soil quality, plant diseases and/or insect pests can have a detrimental effect on the yield of the plantations. Large-scale, multi-year monoculture plantations such as the acacia farms are highly susceptible to these risks. A well-known example of this was the mass destruction of the very commonly used Leucena leucocephala plantations by insects in Indonesia in the 1980s. The use of the plant has been negligible ever since (Carrere et al., 1996; FAO, 1997). The Acacia mangium used by APRIL is on the menu of 19 kinds of insect pests (WALHI et al., 1992). The probability of success of the Indonesian tree plantations has been estimated to be 57% (FAO, 1995). In other words, the possibility of a failure of the plantations is quite sizeable.

It is therefore highly probable that APRIL will be heavily dependent on wood procured from outside its plantations in the future. This will lead to increased pressure on the forest areas outside of the concession areas, and Riau's own reserves might not be enough.